Toyota Grand Highlander expands hybrid crossover lineup

CHICAGO — Toyota Motor is expanding its segment-leading, three-row crossover lineup with the new 2024 Grand Highlander, including two gas-powered hybrid offerings.

The automaker revealed the vehicle as a bigger sibling to the Toyota Highlander midsize SUV/crossover on Wednesday night. It is longer and wider than the Highlander and provides 13.2 cubic feet of additional cargo volume, according to Toyota.

The vehicle is the latest example of automakers attempting to go bigger and test their pricing power as consumers spend record amounts on new vehicles. The average price paid for a new vehicle to begin this year was nearly $50,000, as automakers prioritize high-end models over entry-level models amid ongoing, yet improving, supply chain problems.

Toyota did not announce pricing for the Grand Highlander, however analysts expect it to be above comparable regular models that start between $36,000 and $51,000. It will be offered in three trim levels when it arrives in dealerships this summer.

The average price paid for the current Highlander was more than $46,600 — $48,801 for the hybrid — during the fourth quarter of last year, according to Edmunds.

The Grand Highlander adds to the growing three-row midsize crossover segment in the U.S., which has expanded from 12 nameplates in 2018 to 16 vehicles for 2023, including the Grand Highlander, Edmunds reports. Other recent additions include the Jeep Grand Cherokee L, the Hyundai Palisade and the Kia Telluride.

The Grand Highlander will compete against those vehicles as well as the Ford Explorer, Chevrolet Traverse and other popular larger midsize SUVs/crossovers. Such vehicles have become increasingly popular — with sales up 4% from 2018 to 2022 — as Americans have moved away from large sedans and other vehicles.

Ivan Drury, Edmunds’ director of insights, said consumers are increasingly looking at three-row crossovers as alternatives to minivans, which are ergonomic but have faced stigmas of being uncool.

“Everybody wants a minivan but nobody wants to admit it,” he said. “People want third rows even if they don’t use it.”

The Grand Highlander was revealed in connection to this week’s Chicago Auto Show. Several auto brands such as Jeep and Volkswagen are expected to reveal specialty models that will likely push up prices.

The Grand Highlander, while bigger than the standard Highlander, will be smaller than Toyota’s Sequoia SUV, which is produced through a truck-based, or “body-on-frame,” process. That assembly offers greater utility but less on-road comfort than a “unibody” process utilized for cars and crossovers like the Highlander models.

“The current Highlander is a little bit smaller than the Palisade or the Traverse,” said Stephanie Brinley, principal automotive analyst at S&P Global Mobility. “You’ve got space for this. It’s also not as ‘truckie’ as the Sequoia.”

The Highlander was one of Toyota’s best-selling vehicles last year, at nearly 223,000 vehicles sold. It was only outsold by the Toyota RAV4 small crossover and Camry sedan. Brinley doesn’t expect the Grand Highlander to be a major volume product, but said it “rounds out” Toyota’s crossover lineup and gives customers more options.

Edmunds reports the Highlander was the best-selling three-row midsize crossover/SUV in the U.S. last year, beating out the Ford Explorer, Grand Cherokee L and Toyota 4Runner. It’s also one of the most cross-shopped vehicles by consumers in the segment, according to Edmunds.

Toyota says the Grand Highlander will offer a suite of active safety and convenience features as well as 13 cupholders and seven USB-C charge ports across the vehicle’s three rows.

The SUV will be offered with three different engines, including two hybrids — setting it apart from many of its top competitors. The entry-level four-cylinder turbo gas engine and V6 hybrid are currently available on the Highlander. The top-end V6 Hybrid MAX will produce 362-horsepower and 400-pound feet of torque, Toyota said.

The hybrid Grand Highlanders follow Toyota’s overall strategy of offering a mix of traditional gas engines, hybrids and all-electric vehicles as it pushes toward carbon neutrality by 2050.

“This three-row model takes the Highlander legacy to an entirely new space while also keeping our promise to deliver on electrification,” Lisa Materazzo, group vice president of Toyota marketing, said in a release.

Toyota’s U.S. vehicle lineup includes 10 hybrids, two plug-in hybrid electric vehicles and the all-electric bZ4X and the fuel cell-powered Mirai.

The Japanese automaker has been criticized by some investors and environmental groups for not moving to all-electric vehicles more quickly. The company has argued that not all consumers will move to EVs at the same time and that it can produce dozens of hybrids with the same amount of carbon emissions as one all-electric vehicle.

Toyota plans to invest roughly $70 billion in electrified vehicles, including $35 billion in all-electric battery technologies, over nine years. It plans to offer about 70 electrified models globally by 2025.

Toyota — the world’s largest automaker — plans to sell about 3.5 million all-electric vehicles annually by 2030, which would amount to only a third of its current annual sales.